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tv   Countdown to the Closing Bell  FOX Business  December 13, 2012 3:00pm-4:00pm EST

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>> here we are at the 11th hour, the president still is in serious about dealing with this issue right here. fix the issue, spending. most americans would agree spending a much bigger problem than raising taxes. they want us to deal with this irresponsible way. liz: and that killed us. that was it for the market. i am liz claman it is the last hour of trading. "countdown to the closing bell" begins right now. the stocks are falling for the first time in seven days after the house speaker said it is all coming down to spending cuts.
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with just 18 days left for congress to make a deal, investors are taking speaker boehner's words to heart. dow jones industrials off of the session down 82-point but you can see the bull's have the edge early on. blue chips posting modest gains around 11:30 a.m. eastern the speaker got up front of the cameras and suddenly vanished, the rest was history. one name defined the laws of gravity. solar city, soaring up 1.5% today. this after a price cut and a one-day delay. they completed the ipo selling more than 11 million shares at $8 a pop. half of the expected range. we have both the chairman and ceo, actually cousins, coming up in the next hour. what they have to say.
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they did not put it off, you can see the big move. zero plate to quality, the gold brick falling off of mount everest. the market is not looking good either. traders. okay. we could really pinpoint this to speaker john boehner speaking at 11:30 a.m. and the traders must have believed there isn't a deal and this is not baked into the cake we will have a deal before the end of the year. >> this market is all about what have you done for me lately and if you look at the chart can be considered a way it angled lower and lower after coming out of washington but hit rewind, go back to yesterday and the day before, the market reacted positively, so it shows us how sensitive the market is right now and clearly we are running out of time. tomorrow is friday. we have a full week next week but that is the last full week of the year.
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we're talking about the fiscal cliff running out of time, so different factors people are trying to play the end of the year trade. we're getting down to the end of things now. liz: what were they buying today, what were they selling? >> a follow-up from what we have seen in the past and what we think we will see in the future. just because regulations will be a little bit more transparent coming forward and the energy sector has been a hot one. how will that play in 2013. my clients are not looking at tomorrow or next week, they're looking to second quarter next year. liz: that is smart. i know you're looking at oil as well, looking at the aftermarket down another dollar on top of the $20 closing. no help at all. history the dollar was so weak the dollar still cannot manage, but what is this about? >> i know you love and we dip.
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liz: i think it is fascinating to watch, which truly is. >> yesterday the dollar was lower, today the dollar is higher. the dollar was pretty strong today. i agree with him about it being sensitive, but i think there is uncertainty. we are not really doing anything. we are waiting for what is going to happen. liz: what about the rumors of hedge fund liquidation? that is basically what we have had the past couple of days read a real shock factor. something had to have happened. >> unfortunately i am not privy to that, but if i had a nickel every time i heard about it moving the market, i would have a lot of nickels. liz: a lot of nickels and not a lot of gold.
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looking at the dollar as well, we saw it slightly weaker today. what popped out to you? >> when you look at the back and forth a little bit weaker than higher, commodities across the board really being down for the most part. i think we are coming up again at the end of the year, people looking at the fiscal cliff situation and everyday we get something different coming out of washington today, disagreement. tomorrow it could be sounds like talks are progressing. we can see things slip around staying in this broad range across a series of markets and i think he will continue to see that until yo they get some kinf definitive answer and direction out of d.c. we will go from economic standpoint and getting money to work in the most efficient way. liz: good to see you gentlemen, thank you very much. never gets boring around here on fox business lackluster retail
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sales from the fed announcement yesterday turning on the stick is beginning next month painted the market red leaving me wondering if high investors, the smart money might be changing their investment strategy. we thought we would bring in, millions of dollars, they want to see the money grow. joining us in a fox business exclusive. you seem like a very measured person, that is why you have a lot of wealthy clients because you must do well for them. after the announcement they would once again kick in the bond buying program about $85 billion every single month. are you changing the way you are investing these people at all in any way shape or form? >> not at all. this was a double edged sword. expected the market to really pop a lot yesterday and it didn't. what that tells me is they are expecting us to go off the cliff, we already knew they
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would keep interest rates below for a very low timelong time. it made me wonder, what am i going to change for my clients? nothing. i'm expecting a zero rate environment for long time. liz: what about the fiscal cliff and if it affected me go over, are you changing investments in that regard? >> no, we are not changing that as well because it is baked in for a large extent. even if it does go over, really don't think it is a big deal. liz: we love you, but why are you saying it is baked in when we were up, john boehner comes out and speaks and we fall. look at an intraday of any one of the major indices and that is exactly what we see. they punch of green at the open and we were fine until he started talking with the fact we may not get a deal, there is a
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big impasse. >> little at the beginning i really think what is overshadowing this is the fed is saying they will stay in the game until we have a much lower unemployment rate telling me they're expecting a recession, which we're expecting anyway if we go over the cliff.% liz: where are you putting your clients money right now? the last time you were here, you are staying away from the overseas market. do you still feel that way? >> yes, very much. financials we think we'll have a good year next year. it is a good environment for them because we know where the rates will be. decent spread because they are paying nothing. we are continuing to get volatility improvement and they're in a sweet spot right now, i think. it will be for the next year or
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so. liz: state domestic. what about anything that could be a play. seeinseen some better housing d. maybe the derivative place, some of the earthmovers. >> clearly there's going to be some nice upside in peripheral names like home depot and things like that. i think there are other interesting places to find higher growth. liz: and she will name three names, we have 52 minutes left before the closing bell rings. maybe she is right, maybe it is already baked into the cake. a negative surprise, quarterly earnings. lowering the forecast, the stock is basically flat today getting hammered on that. it is up 46% year-over-year.
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investors choosing to ignore some of the negatives today and focus on the positives of the entire year in what may come to pass. the conversation with gary smith coming up, fox business exclusive choosing to speak only with you. stay tuned. having you ship my gifts couldn't be easier.
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liz: dow jones industrials, look at the s&p. the s&p 500 has just turned negative for the week. something could happen tomorrow or it could flip it around but for now losing 96 points, lots of red on the screen but not at the nasdaq at least for one name. after a delay and severe price range cut solar energy solutions company skyrocketing in its first day of trading. jumping about 47%, the initial ipo price range had been 13 to $15, so they are not there yet.
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i sat down with the ceo and chairman at the nasdaq to find out whether the fiscal cliff worries were something else might be to blame. >> i don't think it is the reason we had to take the induction in the price. everybody has been burned so bad with anything with solar. >> it is tough when somebody sounded compelling and now 11th company says this time for sure it will work. liz: the chairman and ceo, just the tip of the iceberg. wait until you hear what he has to say about the ipo. he was torn about whether to bring it to market. they had to cut the price, but find out what convinced them to go through with this. those two are cousins.
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coming up next at 4:00 p.m. eastern time on "after the bell." a fascinating insight discussion on solar city. world's most popular online mapping system making its way back into the iphone. shares of google up today, finally said okay, your maps app can come back. apple falling. >> a huge win for google and a loss for apple. who ago is happening happening with a market cap of apple as well, $500 billion mark as most investors know this is a critical support level for the company. there we go, lot of oscillation on that stock. it is not just about maps. this is about something deeper, giving choice to consumers and getting the ecosystem that apple has so closed off open to google lovers.
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google getting their maps more than a billion monthly active users get on google maps, 50% of them are doing it on mobile, that is why he they're excited to do this. there was talk they would keep it and hold it for the android phones. if it wants to do that. you need to do it. liz: my husband did it at 2:00 in the morning, he was so excited. it is not perfect and i will tell you what is not perfect about it. the voice instruction is in english, it needs to grow, does not have integration with your contacts so if you want to go to her daughter's school, pick up the number and put it into
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google maps you cannot do that seamlessly and it is not available on the ipad yet. liz: google up, apple down. ciena, a company that makes things go through thh pipe of the band with missing street expectations and lowered guidance for the current quarter but the stock is hanging tough higher by more than 5% since the open and has since pulled back but what are investors seeing heading into next year and how will competitors derail the current run? gary smith, ciena ceo from baltimore, maryland. thank you for joining us. >> thank you for having me. >> every kid, everybody we know
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is buying a brand-new smartphone constantly upgrading. i would have thought you wouldn't miss estimates because they would have to be buying more equipment to absorb the new and bigger traffic. what went wrong in the quarter? >> expanding in a market that's declined last year about 7%, so we took market share for sure this year and we are very well positioned. our backlog increased by 25%. we are very well positioned to ride the growth curve. liz: you are up 46% over the past year. a huge short for it, 30% is shorter, but they're getting squeezed because it is not playing out for them. one thing we do know is some telecom providers, take a look at verizon, at&t, telecom, some of them are putting off big
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capital expenditures, equipment upgrade. why is that? that would be beneficial to you if they didn't do something like that, but what is going on there? speak of this industry, the dynamics are very positive, as you said. the requirement for all these applications, the mobile phones continues to increase exponentially and we haven't even begun you have to talk about machines communicating to each other. the dynamics are generally positive but we are not immune from the uncertainties, and i think that certainly impacted our industry last year. liz: give me an example of machines communicating with each other, what more will we see? >> things like cars having more capabilities and activity. we talked about google maps, having that availability between machines and cars to things like sensor devices for utilities so they can automatically measure things without having to send
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people out, the intelligence gathered from that is enormous, and we are at the very early stages of that communication boom. liz: one analyst we spoke with says your cash flow and margins can be negative, what do you say to that? >> people are entitled to their opinions. we performed extremely well, generated over $100 million in cash this year. we are profitable, we think the 2013 will be an even better year for us. i would describe it as stable, we don't have a lot of exposure frankly to southern europe so we are quite well-placed. mainly in northern europe, which has been somewhat less effective, so we are somewhat stable there. good growth in asia-pacific and latin america and frankly the united states as well. liz: the competitor, cisco coming in, they want into the
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optical switch business ramping up, how would you stay ahead of them? >> they're very specialist player. we're not trying to be all things to all people. as such we have a lot of leading technology in this space and already won a lot of the major deals ready to roll out. tracy: are you hiring now going forward? here in the u.s.? speaker yes, we're actually doing some hiring in the united states. liz: good to see you, have a happy holiday. >> thank you, you two. liz: 46% over the past year. gary smith saying they have a good year ahead. the fed are going after a star in the hedge fund world through employee who left the company two years ago going so hard to the point they want a former
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employee to flip and cooperate with the investigation. charlie gasparino has the latest on the screws content to be tightened. you need to see this story. copd makes it hard to breathe,
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>> federal prosecutors want former hedge fund trader to cooperate. they desperately want him to cave basically. in an effort to build the case against his old boss, steve cohen, and, instead, he's cooperating with cohen. is this a full-out cooperation? >> remember what we reported yesterday? they are paying for the attorney. we don't know if there's reasons for that or possibly an employment agreement that covers even employees fired two years ago for poor performance, and
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charged with something on the job, charged with insider trading, faces 20 years in jail for actions he did while he was at sac capital, but this is a nuance, that's more than a nuance. here's what's going on. in addition to paying for that attorney, there is an agreement between the capital and the attorney charles stillman. what's this mean? this is interesting. what it does is that it means that any time there's a document request from the feds, goes what, cohen knows about it. any time, you know, that the feds bring in martoma, want to talk about him again, cohen knows about it. his attorneys know that if matthew does, indeed, flip, he's got the playbook of the government against him. this is a very key move in defending himself against what is obviously the feds' attempt to indict one of the biggest
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hedge fund manager, known as the greatest investor of -- at least in recent history. steve cohen is a master record that surpasses warren buffet. last 15 years returned, at least since 1996 we'll see, he's returned 25.5% after expenses. warren buffet has returned 8.6%. >> oh, so he's way up and above. >> the s&p has returned 5.5%. something like 5%. he beats the market. now, i will tell you this, the feds say there's no way to beat the market. he beats it every yearment one down year in 2008, not because of investing, but the financial crisis; right? he went into cash soling out the positions. feds believe he plays dirty, but he says he researchers. he's a great trader. it's impossible to have that type of return -- just purely --
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>> the feds breathing down his neck saying, "twenty years, math threw, twenty years," and that legal fee -- >> this is where steve cohen and his attorneys are smart. if that's the case, they have the play book because there's a cooperation agreement. they know what he'll cooperate on, how to defend themselves. there's an insight into the case. this is a key move, very big here if you're steve cohen to know what the play book is because it's likely to be a play book. listen, if this guy goes to trail, martoma, the guys, listen, they have a conviction rate of 95%. this guy, based on jurors, the way they act, is going to go to jail for at least ten years, at least as long as roger founder, when you told -- in terms of the case they brought, when they totaled up illegal trades, how
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much he saved and made, saved from losses or made from gains, it was less than a hundred million. i know that. it might have been significantly less. maybe something like 80 million. martoma, they say, either made or prevented losses through his illegal trails in the stock having inside information provided to him by a doctor in the study, and he saved or made $270 million. >> so if roj got what he got -- >> it's jail for ten years, unless he cooperates. >> if he cooperates? >> three, two, and, by the way, -- >> i'd take that deal. >> tell steve cohen, there's a phone call before steve buys the stock. what was said in the phone call? did steve know it was insider trading when he bought the stock or should have known. i like steve to be honest.
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i think, you know, my opinion is they shouldn't put anybody in jail for insider trading. it's nonsense. it's a civil crime. it's not people go in jail for robbery. >> i have to get to the twining ky news, charlie. there's twinkie news which is that walmart may save hostess, of course, the proprietor of twinkies. the word is that these two are possible bidders. hostess says no. >> why? >> i don't know. i think kroger wants the wander bread. >> how much it go for? >> 1 billion liquidadtio. >> maybe that's why nobody cared. >> you don't allow anything
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negative in your body at all. you have not ate a twinkie in -- >> i could say 40 years. >> 40, okay. >> now you know i'm over 40. >> i was 38. okay. 83 appointments to the downside, well off the lows, we were down 96 points for the dow jones industrial, red across the board. stay tuned, coming right back, 20 # minutes before that bell clangs. ♪ what's next? he's going to apply testosterone to his underarm. axiron, the only underarm treatment for low t, can restore testosterone levels back to normal in most men. axiron is not for use in women or anyone younger than 18. axiron can transfer to others through direct contact.
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>> this is your fox business brief, continues to be a down day for the markets after house speaker john boehner said spending was the issue preventing the deal on the fiscal cliff negotiations.
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right now, dow down 76 points. fox news reports former republican senator hagel emerged at the leading con tender to be president obama's pick to be secretary of defense, according to several democrats briefed on the process. the same sources say senator john kerry is talked up within the administration as a more likely nominee for secretary of state over susan rice, the current u.s. ambassador not united nations. a new study suggests this christmas travel season could be the busiest in six years. aaa predicts more than 93 million americans hitting the highways over the holidays, just 400,000 people shy of the record set in 2006. we continue our count down to the closing bell with the woman who likes her politics the same hi way likes her martinis, shaken, not stirred. liz: no, a mojito, light on the
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rum, adam. get it right. >> you look like a vodka woman to me, i don't know. liz: never. can't deal with that. a rough year for jcpenney, but things changing. the stock popped, but now the stock is up more than 17% this week alone. nicole? >> what a run for a company that's been struggling, sales dwindle, less traffic, ron johnson figuring out a way to get this one to be a win ere. the stocks today here is up 7%. why is that? well, nina garcia, call it the nina garcia bongs. basically, nina garcia, a fashionista, involved with elm is a judge on "project runway" posted links from -- on her website to jcpenney, and the concept how they will have stores within the store so this is all their new way to get
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people to come in, and they are actually doing a few promotional items as well. they wanted to get out of that and phase out so it's a winner. 7% today. that's good. liz: just nearly cut losses in half, markets coming back it looks like, down 61 points after being down more than 90. this is moving on the rioters wire, and republican speaker of the house, john boehner meeting with president obama at the white house today. okay? at 3:30 eastern, not a lot of hours left and daylight here, but getting together according to a white house official. we'll see if the markets make a better comeback at the moment. well off lows, same with the s&p and nasdaq, a tough day for most of this. okay, 5 p.m., now we have the number, the time, 5 p.m., john boehner going to the white house for a meeting, according to wire reports. the airline industry has become infamous for losing money, but
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spirit airlines created a flight pattern to consistent profits. ben, spirit airlines ceo joining me now in a fox business exclusive going into the holiday travel season, and following the story now for a better part of a couple years, finding it absolutely fascinating, and airline able to do this embracing nickel and diming. tell me first how is the airline situation looking going into the christmas two weeks before? >> well, great to see you again, liz, and merry christmas, and, you know, christmas, the christmas hanukkah season is traditionally a strong volume period for the airline industry, and this year seems to be no different. people love santa claus, and we're seeing a very strong volume heading into christmas. liz: people in freezing temperatures love to see santa in florida. that's helping your bot time line. november traffic, then, up 28%. to what do you attribute that move? can you vest that number in the month of december?
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>> well, it would have been better if not for the thing that the hit the northeast, but generally, the model is great because we offer low prices, and consumers respond great to low prices. the fares lowest in the industry, and even after you add the fees of baggage, total price, it's lower than the next best option, and people like that because they want to spend money on the hotel, not the air fare. liz: listen, i know, and it's working for you guys because, listen, you have absolutely done pretty darn well, up 8% year over year, not killing the s&p, but, i'll give it do you. you talk about nickel and diming, and, again, you embrace that, but now you're getting customers saying, look, we get it. pay for an extra bag, a pillow, and boarding passes. my question becomes you are sort of adding on to the
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expenditures, but they are psychologically not enjoying it. how can you improve the experience? listen, you guys are gets negative tweets. that's one of the things we did notice. >> one way to stop is it stop calling it "anything -- "nickel and diming," and call it choose. it's a choice program. pay for what you use, but importantly, you can save money if you don't use it or if you don't pick it, and customers really like that. they like saving money, they like having the ability to adjust their final price point. they can put everything in the shopping cart and say, you know, i'm spending too much. maybe i'll carry one less bag this time or get to the end and say, this is not that bad, a nice big front seat and spend more allowing them that flexibility opposed to just here's the price, pay it or not. liz: sure. we cannot forget always at the forefront of your cerebellum as an airline institute, you have
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to look at oil prices, jet fuel hedges, ect., oil around $86 a barrel. it was so bad that delta got smart and outright bought an idled refinery from phillips 66 in order to control fuel costs. how are you getting creative? what are you doing? >> well, you know, that was a bold move by delta for sure, and one of the things reflebtive of the fact that oil prices move, but so does refining cost, the crack spread, and so what we have to look at in the business is jet fuel prices, how they change. we've seen times when oil prices drop, but jet fuel is the same because the refining cost expands to cover the difference. what we do at spirit is try to be really first time. we have a young fleet of airplanes that doesn't burn a lot of fuel, and because we put a lot of feet on our aid and aie burn less than any other airline in the u.s. gives us a little bit of an advantage when fuel prices change because we don't
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burn as much as the other guys do making us the greenest airline out there. liz: ben, we got to go, but just moving on the tape that john boehner's spokesperson is confirms a 5 p.m. eastern meeting with the president, maybe this log jam broken up with the talks. if you had their ears, what would you say, very quickly. >> i would say that my bet is hoping boehner wins the fight. liz: on spending cuts? >> on spending cuts, getting to a balanced budget and certainty is good for the economy. liz: ben, spirit airlines ceo, good to see you, have a good holiday season. >> have a great holiday. liz: we'll be back in just 15 minutes to see how this one ends. stay tuned.
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>> sandra smith following the big movers, and down sharply today, a profit taking? >> they had a great year in fact. year-to-date chart, up over 200 this year, doubled in price, still a $5 stock, but the home builders have come back from really just dismal numbers. there is profit taking today. the big news is how they were smaller than expected, and look, getting hit, 5% is a lot that had been in the stocks take profit, and down 1.5% today, but any investors in the home builders enjoying nice gains seen so far for 2012. moving on, the sectors, one area is big tech. look at apple, down 1.8% in today's trading session, a big selloff experienced over the last couple months, apple cap dipping below 500 billion today.
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that's a varied market difference in apple all year, and, by the way, liz, handing it back to you, a year-to-date chart here, off the lows of the session, 1420, a bounceback, liz, at the enof the day, and volume very average i'd say at this point. liz: a bounce back of more than 50 # points because join boehner announced through the office he's meeting with president obama 5 p.m. eastern. watching for that as well. he's the fox business market check, the new highs today. do you own these, dominoes pizza or cbs? names looking strong today, adding to the list, hershey, general mills as well. she may not be a raging bull right now, but the woman next to me still has three stocks that she says are the best bets for 2013. you said, of course. in the first hit you like the financial. your favorite here?
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>> bank of america. same thing i said last time i was on, and i pound the table on this one. liz: why? what is it about this company? >> they just have so much negative bind them. the mortgage rates so low. they talked about the cact that's an area of strength for them, and, you know, it's just -- they are going to stay low because of the fed. >> it's going to stay low. iireally believe financials are in the sweet spot right now, and this is such a low priced stock that it's really the best value. liz: call that the fed play, and now to the holiday play. a holiday play you're in love with right now? >> amazon, amazon is a great, really just fabulously run company, and they have it in two directions, the consumer play, the holidays, always their strongest time of the year for the stock, and they have the cloud. nobody talks about that part of the company. the cloud storage. that is such a major under recognized part of the company.
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liz: breaking news right now. >> okay. liz: u.n. ambassador susan rice is removing herself from the running to be secretary of state. this, of course, in the wake of the big discussion about just exactly what she said in the wake of the benghazi attack that kill our ambassador to iraq, and, clearly, this is a developing story, but soon san rice removing herself from the running to be secretary of state. apparently, it's become a distraction for the president. we'll follow that story as well, back to your play, amazon. i have to push you. they are a company, and i love them, baa they get a sale at any price. margins are so thin, and the pe ratio, the multiple is insane here. the price to earnings ratio, so insane, it got its own special graphic. >> the growth rate is equally impressive, and i think some of that is not showing up, and this could double. >> 143 versus 14 of the s&p.
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we got excited. we made a graphic. not a surprise to anyone it's been going, but better growth players like a google, for example? >> google is certainly a good play as well. i just think that if you're looking for something to buy today, they have a much, i think, clearer picture for the next six months of where they are going. google has been iffy lately where they go as far as earnings. liz: holiday play, amazon, a presidential play, something we know could do well under president obama? >> this is my favorite play because it's a little bit riskier, but also the highest reward, and that's is tesla motors, t-e-s-l-a. it's a beautiful car, it already more important in the obama administration, but, also, they are really doing well. their production numbers are up. they've raised capital so that
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they can go ahead and put in energy stations, and it's really, i think, like i said, a little riskier, but it's definitely the highest reward. liz: stock up 23% year over year, and 59% floated. see you next time. >> thank you so much. liz: breaking news, president meeting with boehner, 5 p.m. easternment don't move, here comes the closing bell, six minutes away, and we'll be right back to take you there. blrchg players in history to the number 1 club in the world. the potential of manchester united unlocked. nyse euronext. unlocking the world's potential.
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he loves risk. but whether he's climbing everest, scuba diving the great barrier reef with sharks, or jumping into the marke he goes with people he trusts, which is why he trades with a company that doesn't nickel and dime him with hidden fees. so he can worry about other things, like what the market is doi and being ready, no matter what happens, which isn't rocket science. it's ju common sense, from td ameritrade. liz: not a whale breaching out of the water, but the markets came back a bit on news that the president is meeting with speaker of the house, john boehner, david, at 5 p.m. eastern. the markets came back a little bit. david: see what they have to
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say. of course; they have been negative talking by themselves, when they talk together, perhaps more positive. a lot to talk about today. so many movements of individual stocks, and as liz mentioned, looking bad at 75, but not as bad as it was earlier. nicole, and first, i want to talk about gold because a lot of people just assume that with all the new money that the fed will do, that gold is jumping up in place, exactly wrong, the opposite direction. >> right on because what happened is you have a stronger dollar now. gold is pulling back, a flow of money. gold right now, dave, down 21 bucks. liz: nasdaq swooning 22 points. solar city skyrocketing following what i guess you characterize as a rocky road to the ipo. they chopped their pri

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